Water treatment becoming latest hot Eagle Ford business venture

Water-treatment companies are flooding the parched Eagle Ford Shale, looking to profit from recycling wastewater from oil and gas companies.

The hydraulic fracturing process used to unleash oil and gas in the Eagle Ford requires large amounts of water to force sand and chemicals into dense rock. The resulting waste often includes hydrocarbons, heavy metals and other contaminants.

With drought conditions scorching the region, frackers are facing strong pressures to conserve. Many also want to contain costs by reusing water instead of shipping it offsite for disposal in injection wells.

“The water treatment business is like a gold rush right now,” says Warren Sumner, CEO of Austin-based startup Omni Water Solutions, which has treated 140,000 barrels of Marathon Oil’s flowback water this summer.

“There isn’t enough water to go around. We all know that.”

Omni uses its Hippo mobile treatment system, which can be pulled on a 53-foot trailer, at well sites to remove harmful compounds so wastewater can be reused for fracking or drilling. It also has a larger, modular system designed to stay stationary for a year or more.

“Marathon hasn’t shared their (financial savings), but I do know they’ve roughly cut in half the number of trucks coming into their central processing facility to haul wastewater,” Sumner says.

Investors seem to be noticing the trend.

Omni recently pulled in $4 million from the tech fund Austin Ventures and from individual investors, many in San Antonio. The same group also provided $7.9 million in funding last year.

“As long as we continue to have drought conditions, we’ll see businesses pursuing any and every opportunity to save water,” says Thomas Tunstall, director of the University of Texas’s Institute for Economic Development, which has extensively studied the shale’s economic impact.

While Tunstall says he’s not measured the Eagle Ford’s water-treatment business in dollars and cents, he expect its growth to continue for the next few years.

To be sure, Houston’s Energy Water Solutions this week announced it had implemented its own mobile recycling system in the Eagle Ford’s active LaSalle County to help well operators clean up and reuse wastewater onsite.

What’s more, researchers at the University of Texas at San Antonio and Southwest Research Institute this summer kicked off a $200,000 project to test whether an inexpensive charcoal product can treat fracking wastewater.

But not all companies will be able to turn wastewater into gold, Omni’s Sumner says. He predicts a shakeout as oil companies gravitate toward the solutions that are the most technologically and financially feasible.

“It’s one thing to take some contaminated water and treat it in a laboratory and something completely different to do it 24/7 in the harsh conditions of the Eagle Ford,” he says.

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